The market capitalisation of five Adani Group stocks fell by a total of ₹23,611 crore on Tuesday, with only two of its seven listed companies closing in the green.
Adani Enterprises Ltd had a rough start to Tuesday's trade, but the stock recovered after it reported a profit of ₹820 crore for the quarter that ended in December as against a ₹12 crore loss in the same quarter the previous year. For the third quarter of FY23, operating revenue increased 42% on year to ₹26,612.23 crore.
The stock hit a low of ₹1,611.35, and a high of ₹1,889.00 during the intraday trade.
"The company reported better than expected earnings with improved earnings before interest, taxes, depreciation, and amortization (EBIDTA) margins from 4.1 % to 6.1%. All the verticals in the company performed well above market estimates specially mining business… We continue to remain neutral in the outside environment which is still against the Adani group," said Prashanth Tapse, Research Analyst, Sr VP Research, Mehta Equities Ltd.
Adani Enterprises Ltd gained about ₹3,493 crore in market value and ended 1.87% higher. Adani Ports & Special Economic Zone Ltd gained about ₹3,061 crore in market cap and closed 2.06% higher.
Adani Total Gas Ltd (lost ₹6,431 crore), Adani Transmission Ltd (lost ₹6,154 crore), Adani Wilmar Ltd (lost ₹2,657 crore), Adani Green Energy Ltd (lost ₹5,366 crore), and Adani Power Ltd (lost ₹3,003) each closed 5% lower.
According to Avinash Gorakshakar, Head Research of Profitmart Securities, it might take another six months for all of the Adani Group companies to recover from the recent price correction. The group is currently trying to reassure the investors by lowering its debt levels and removing pledges, but anytime a price trend is broken, it usually takes at least four to six months for the price to recover.
Recently, Adani Transmission Ltd, Adani Green Energy, and Adani Ports and Special Economic Zone pledged shares to SBICAP Trustee Company, a division of India's largest lender, SBI.
In reaction to US-based short-seller Hindenburg Research report, Moody's Investor Services on Friday, February 10, changed the rating outlook for four Adani Group firms (Adani Green Energy Ltd, Adani Green Energy Restricted Group, Adani Transmission Step-One Ltd and Adani Electricity Mumbai Ltd ) from 'stable' to 'negative' after a sharp and quick decrease in market value.
Further, the Adani Group has cut its growth target and plans to hold capital expenditure (capex) in post-Hindenburg repair moves. During the Adani Port & Special Economic Zone Ltd conference call, the management said very clearly that it wanted to tone down the growth, and repay ₹5,000 crore of debt in the current year.